In the six years since winning Midemlab‘s startup competition, SoundCloud has grown into a huge global music streaming platform with over 175 million unique users monthly. For the last day of Midem 2015, its co-founder Alexander Ljung (top photo) gave on onstage interview to discuss the past, present and future of his platform.

Built by musicians for musicians (both Ljung and co-founder Eric Wahlforss are electronic music producers), the vision for SoundCloud was to create an easy to use music uploading portal where fans could share and creators could create.

Ljung’s ambitions were grand from the outset, and monetisation is next on the cards with his partner programme, On SoundCloud. It now has over 100 partners, including companies that sit under independent network Merlin, who are receiving income from SoundCloud meaning artists like Bjork and Aphex Twin can earn revenue from the creative projects they upload.

“Cool things can happen when you put the creators in control. We’ve got some amazing artists using the flexibility of SoundCloud and the openness of it, and now they can generate revenue from [their work too],” said Ljung.

Discussing the future of streaming services, Ljung said those offering a combination of ad-supported and subscription tiers will help grow the music business. “For me, it’s very clear that it’s a combination of both, and that’s for a few reasons. Firstly, music has an incredible power to connect every person on the planet and part of it is about how you share that experience. There needs to be openness around the share ability.

“There are 3 billion people online, you’re never going to all get those into subscription, it’s not going happen. Instead of having a debate over ad-supported or subscription, the big question of the music industry is how do you segment the market into the right place. You get the people that are willing to pay for a sub into a sub and the others into an advertising model. It’s really about how you draw the line between the two.”

For Andrus Ansip – Vice-President of the European Commission’s Digital Single Market – growing the music and creative business is all about allowing the free flow of online services and entertainment across different borders. Tackling piracy is high on his agenda, which is a problem he thinks isn’t being helped by legislation in Europe at the moment.

“In the EU, our creators are losing huge amounts of money because of piracy. Somehow our legislation is pushing people to steal, but we can say that if somebody is able to provide a service with better quality and higher speed, people prefer to act as honest people,” Ansip explained. “They are ready to pay, they don’t want to steal. We have to provide legal access to digital content to everyone and then it will be more fruitful to tackle piracy. Our aim is to create a more level playing field for everybody.”

After taking the audience through a run-down off his long and illustrious career, working with names including Elton John, Led Zeppelin, The Rolling Stones and many more, veteran music promoter, Harvey Goldsmith CBE, also used his speech to make some suggestions to preserve the future of the music business. Managers, labels, publishers, promoters, live agents and collecting societies are all “at war” with one another, he said, and should instead be sitting down together and working out strategies for issues like secondary ticketing and the diminishing monetary value of music.

“The problems in the music business are mirrored by the major issues in the world, but in the world, we have the United Nations, in music there is no such thing. Most of the discourse is siloed. The business has no talking place to talk about issues that affect us.

“Record companies still don’t engage with the live business, publishers and collection societies are at war with record companies, agents and promoters complain about each other, and the managers watch everyone fight each other.”

Goldsmith called for young promoters to find and commit to developing new artists who can grow, and for record labels, publishers to stop fighting and nurture talent. “There’s plenty of talent out there, it just needs championing to cut through the [noise].”

Then at the Midem 2015 wrap panel, Cooking Vinyl’s Sammy Andrews, Domino’s Jason Reed and Believe Digital’s Nick Parry — Midem Label Ambassadors during and before this year’s edition — summed up key industry trends. Streaming was a key topic, with Apple’s service due to launch today. “We’re excited about it,” said Andrews… “if the deals are done right and we’re paid correctly.”

The high-end music experience was also discussed, with offerings such as hi-res audio and products like Gramofon. “Because we grew up with mp3s, that’s what we’ve become used to,” said Reed. “Maybe that’s part of the vinyl resurgence.” Parry, for his part, focused on big data, wondering if music is drowning in it. “The solution will come in the form of different applications and tools,” he said, adding that Apple and Pandora’s recent acquisitions of Musicmetrics and Next Big Sound respectively “make perfect sense.”

All speakers said they were already leveraging that data. “We’re still in the early days of big data, but everyone’s doing it, ” concluded Andrews.

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This is the official blog of Midem, the destination for music business connections and knowledge, and its conferences (next edition: June 3-6, 2016, Cannes, France).
midemblog is edited by Reed MIDEM's social media team, with regular guest contributions from industry experts.